where orders emerge

Five Wacky Notions Believed By Many Economists

What is [the] most ridiculous economic fallacy that is believed by a significant number of professional economists?

Wow. Good question. There are many such fallacies, and it’s difficult to rank-order them according to their ridiculousness. My list and rank-ordering, of course, reflects my own understanding of economics (which is Hayekian-Alchianian-Coasean-Buchananite-McCloskeyan) and my subjective assessment of ridiculousness. But Mr. Bryant’s question is fun, so here’s a list of five:

(5) the idea that government-subsidized health care will lower the cost of health care;

(4) the notion that government must have monopoly control over the money supply in order to ensure sound performance of the economy;

(3) the belief that large differences among people in monetary incomes or monetary wealth reflect some market failure that ought to be ‘addressed’ by the state;

(2) the blind faith that government officials in democratic societies can be trusted to exercise power over people who economists do not trust to make choices for themselves;